In Detroit, Everything Still Comes Down To Trust

The news services and cultural blogging community are abuzz with yesterday’s news out of Detroit where musicians and management exchanged a vitriolic round of PR artillery. But the other news is that management asserts they have submitted a revised offer that provides the first series of economic improvements in several weeks…

According to reports in the Detroit Free Press and Detroit News along with a press release from the Detroit Symphony Orchestra (DSO), the latest DSO proposal increases their offer from an overall annual budget of $34 million to $36 million.

But there’s a catch, the DSO has indicated that the $2 million increase is only a contingency offer and not a contractual obligation.

For those who may not be familiar with this practice within the context of an orchestral collective bargaining environment (CBA), contingency payments are additional financial rewards that only become obligations if the organization secures predetermined revenue levels during the term of the agreement.

Here’s a straightforward example:

  • An orchestra employer agrees to pay each musician employee $100 each week for 52 weeks a year.
  • This payment schedule is guaranteed over a period of three years.
  • If, at any time during the three year term, the orchestra secures more than $1 million in annual revenue, the musician employee weekly pay rate increases to $125 for the remainder of the CBA.

Keep in mind, there are numerous variations on this theme but that’s the general gist of how it works. The practice of incorporating contingency payment schedules into a CBA is not new, nor is inherently good or bad; it is simply a tool. But here’s the important caveat: it is only a worthwhile tool when both parties trust one another.

Here’s where the contingency payment proposal from the DSO could begin to break down.

In both of the newspaper reports referenced above, DSO executive vice president Paul Hogle indicated that since the onset of the strike, potential donors have been primarily interested in funding activities the DSO has defined as educational and community outreach oriented. Anything else more closely resembling traditional mission based activity has generated little to no interest.

Let’s set aside the questionable practice of tossing around unnamed donors in a public forum during a labor dispute alongside conveniently selective confirmation, and focus on the face value of Mr. Hogle’s statements. When combined with how hard the DSO has pushed their new vision via public relations efforts (“A Vibrant Future“), it becomes increasingly difficult to generate minimum necessary levels of trust among the musician stakeholders in the belief that their employer will expend sincere efforts to raise the additional revenue necessary to trigger the contingency payments.

Consequently, it will be interesting to see whether the federal mediator assigned to this case will take any of these issues into consideration when deciding how best to move forward.

Ultimately, in order for the DSO to regain firm footing for any future mission based activity, it will need to restore levels of mutual trust between all stakeholders. Unfortunately, the price of trust, in real dollars and cents, is far more expensive now than three months ago when the dispute went public. But that is something most organizations that endure this sort of conflict only realize in hindsight.

About Drew McManus

"I hear that every time you show up to work with an orchestra, people get fired." Those were the first words out of an executive's mouth after her board chair introduced us. That executive is now a dear colleague and friend but the day that consulting contract began with her orchestra, she was convinced I was a hatchet-man brought in by the board to clean house.

I understand where the trepidation comes from as a great deal of my consulting and technology provider work for arts organizations involves due diligence, separating fact from fiction, interpreting spin, as well as performance review and oversight. So yes, sometimes that work results in one or two individuals "aggressively embracing career change" but far more often than not, it reinforces and clarifies exactly what works and why.

In short, it doesn't matter if you know where all the bodies are buried if you can't keep your own clients out of the ground, and I'm fortunate enough to say that for more than 15 years, I've done exactly that for groups of all budget size from Qatar to Kathmandu.

For fun, I write a daily blog about the orchestra business, provide a platform for arts insiders to speak their mind, keep track of what people in this business get paid, help write a satirical cartoon about orchestra life, hack the arts, and love a good coffee drink.

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8 thoughts on “In Detroit, Everything Still Comes Down To Trust

  1. It is disturbing that the traditional mission of the DSO (presenting concerts)is reportedly not attracting potential donors. Education and outreach are certainly worthy activities, but not all great orchestral musicians are equally talented as educators.

    If institutional attention becomes primarily directed at education/outreach because of the potential funding stream at the expense of committing to support of the traditional mission, the economic realities of maintaining an orchestra of DSO caliber will be “the elephant in the room” that must be addressed.

  2. Exactly. Let’s all hope the impending bargaining sessions will produce something beyond PR bluster. If the stakeholders have any sincere desire to move forward in the spirit of compromise, they’ll need to spend time in the sessions talking about the trust issue as opposed to merely terms and contract language.

  3. Hogle’s assessment may be a bit of hyperbole, but I think he’s generally right. Institutional funders are mostly interested in education, partnership projects with other community organizations, and commissions; general operations support is very tough to get. There are still a lot of individual donors who will support gen ops, but even a lot of the major donors are less interested in supporting standard concerts.

    But really, is this such a bad thing? Don’t get me wrong, I like symphony concerts, but we can’t ignore the substantial needs in our communities for arts education and greater integration of arts in everyday lives (i.e., outreach). Arts programs are disappearing from schools, and contemporary culture no longer engages with art strictly in a concert hall, museum, theater, etc. The concert hall experience will always be a part of what orchestras do, but I think the funding community is simply reflecting the changing times.

  4. Unfortunately, we likely won’t find out or confirm what is or isn’t the case since everyone seems more interested with the politics of bargaining at the expense of long term relationship building and institutional health. Most foundations aren’t terribly shy about making their positions and funding parameters known so it is puzzling as to why it is such a secret.

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